Listener 4 October 1997
Keywords: Social Policy;
Economists use “revealed preference” to judge people’s real intentions, rather than relying on what they say. While our politicians often talk about the importance of children – `they are our future you know’ – their practical decisions reveal quite different priorities.
The best, practically the only, comprehensive economic data source about the state of children is the Household Survey. Each year it acquires information on the structure, incomes and expenditure of about 4000 representative households. (There is also some information in the five-yearly Population Census but it is coarser, substantially less detailed and less comprehensive, and less frequent.)
Undoubtedly politicians will agree of the importance of this survey for monitoring the economic state of a key part of the population (and on other important groups – such as the elderly – too). But are you surprised that the government has announced the Household Survey is to be carried out only every third year after 1998? The government’s true priority of children is revealed.
This is not the only instance. The government spends around $300 million a year on science research. (Little of this goes to the social sciences. The TV program Timebomb cost more to make than the research on which it was based.) The disbursement agency, the Foundation for Research Science and Technology (FRST) has just invited applications for the funds. Applicants are encouraged to contact “end-users” of the research to justify their research’s usefulness. FRST helpfully lists some, including government departments, farming, fishing, forestry, minerals, manufacturing, and tourist organizations, and so on. From the way politicians talk you might expect the Commissioner for Children to be on the list. He is not. In other ways FRST is no better. Unfortunately I am going to have to quote my own experience. Other researchers have told me their own, but when I suggest they give their story to journalists, they back off because they might want to apply to FRST again. Over the last decade the government has concentrated its power over researchers. One should not cross such a powerful funder.
My story begins with the Household Survey. In order to protect the integrity of the data, there are strong restrictions on access to it by private researchers. However government officials are not subject to this restriction, so they have done most of the work. Until recently the only way around this restriction was very expensive and, of course, the government controls the funding too. In effect the government has a monopoly, which it has used to control research. What officials do, irrespective of how competent or otherwise they are, sets the framework for everyone else. Recall the 1996 debate on the tax cuts, which was dependent on a Treasury model, whose validity could not be evaluated. There is good reason to believe that the effect of the official assumptions is to reduce the estimated numbers of children below the poverty line. Which suits the government because that means they do not have to give children priority.
A few years ago I found an ingenious method to give private researchers very good access to the Household Survey data, without compromising its integrity. I applied to FRST for funds to exploit the method, which should open up knew vistas of our understanding the economics of children.
The FRST application procedure involves the obtaining of assessments by anonymous referees who are meant to have expertise on the research. Among social scientists this exercise is considered a bit of a joke because the real experts are often overlooked, while neophytes are asked their opinions. My project had six referees. Five (including the two overseas ones) were very supportive. The least supportive made a number of grumbling points. These were not very persuasive because the referee thought I was going to use the Population Census rather than the Household Survey. One must doubt the competence of a referee who apparently knew neither the research literature nor understood the statistical base.
The referee’s reports then went to a government appointed panel. There is a lot of criticism of the panel although some members are eminent in their particular fields. Unfortunately none seemed to know much about household economics, since when they turned down the proposal they cited the mistaken objections of the sixth referee. I was surprised too, that not one of the panel appeared to know the difference between the Census and the Survey. There is no appeal process to deal with such incompetence.
The cynical will argue that a government appointed panel would never undermine a government research monopoly, but my guess is that none knew enough about the research area to appreciate they were doing this. Whatever, FRST put back by at least two years the research work on the economics of children; more, because it is pointless after this column to apply for funds. It is said that one research group with a similar experience have calculated the cost of applying for FRST (it is substantial) and put the money into lotto on the basis that will give them a better return – and fairer.